The Council of the Federation of Arab Security Authorities discusses in Muscat the development of capital markets

To address the risks of geopolitical and economic change

The Sultanate of Oman, represented by the Capital Markets Authority, hosted the sixteenth meeting of the Council of the Federation of Arab Security Authorities, with the participation of Their Excellencies, representatives of member states in the Federation Council; Aiming to strengthen ways of cooperation to increase the legislative and regulatory level of the Arab stock markets in a way that achieves justice, efficiency and transparency, and work to unite efforts to establish effective levels of control over transactions in the markets achieve, in addition to discussing a mechanism to address challenges, changes and developments in the regional and international arena.

On the sidelines of the Federation Council meeting, a memorandum of understanding was signed between the Federation of Arab Security Authorities and the Regional Center for Sustainable Finance of the Egyptian Financial Supervisory Authority. With the aim of improving cooperation in the field of building self-sufficiency related to sustainability and financial instruments for the green economy and management, as well as the exchange of technical expertise and assistance in the field of sustainable finance, and the design and implementation of professional training programs in the areas of development.

His Excellency Sheikh Abdullah Al-Salmi, CEO of the Capital Markets Authority, in his speech at the meeting emphasized the importance of the development of capital markets, faced systemic risks and supported liquidity and financial sustainability, saying: Our economies are intertwined and interconnected between us and the outside world, which poses challenges and risks for us to deal with.Especially with regard to combating money laundering and terrorist financing, and addressing the possibilities and risks of the collapse of financial markets; Due to global geopolitical and economic situations, as well as cyber and fraud risks. We also need to look at issues of supporting national and international efforts to mitigate the effects of climate change, and to find sustainable alternatives and funding instruments that meet the 2030 goals for sustainable development.

His Excellency emphasized the need to deal with financial technology and cyber risks, as the technical richness and its increasing dependence, especially among the younger generations, and its integration into decision-making and operational processes, make it a necessity and a reality that must be addressed and make the most of all the opportunities offered by information technology.And utilize communication in all areas, while being vigilant and alert to the inherent cyber risks that have become a daily threat to our markets and institutions, and the importance of giving this risks are a priority in the design of business and procedures, and changing the mentalities that work in our technical staff and sectors, and the bodies that are supervised and regulated by our bodies. His Excellency also stressed the importance of investor education and awareness and said: investor awareness is the safety valve for the markets. Economic growth and its maintenance. He explained that the interdependence of Arab economies requires cooperation and work within a balanced formula in legislation. and regulatory frameworks that combine prudence and risk management on the one hand and development, innovation and innovation on the other.

In response to a question about the impact of the rise in oil on stock markets, His Excellency explained to reporters that the rise in oil prices has a positive impact on the economies that depend on oil prices and therefore positively reflects the performance of the financial markets, which indicate that what is lacking in the markets in the region, especially the Sultanate of Oman, is the primary market in seeing new issues In the primary market and products to find a recovery in the market, note that the market is good and we have seen an improvement from the beginning of the year until now, despite the geopolitical conditions, and the economy seemed to be improving, which is reflected in the performance of the market in general.

performance of global financial markets

In turn, the dr. Maryam Al-Suwaidi, President of the Federation for the fifteenth session, said in her speech: The year 2021 witnessed important developments and events reflected in the performance of global financial markets, which are constantly due to the repercussions of the crisis of the outbreak of the Corona virus, and despite the negative impact the pandemic has had on global economies. Particularly developed economies in which public debt rates recorded unprecedented rises were able to continue to achieve positive growth rates in global financial markets during 2021, as the MSCI World Markets Composite Index (MSCI World Index) showed record growth for the third year over, respectively. a rate of about 17%. She added that during the year 2021, the Arab supervisory authorities, in cooperation with financial markets and governments, could work to overcome the impact of the repercussions of the Corona crisis on financial markets. It also went on to make significant achievements in the areas of oversight, updating legislation, regulation and enforcement, and setting up appropriate frameworks and mechanisms. To improve its oversight capacity and to develop rules for transparency, disclosure, governance, education and awareness; This is to ensure the stability and balance of financial markets.

Jalil Tarif, Secretary-General of the Union of Arab Security Commissions, confirmed that during the year 2021, the Union was able to strengthen its position in regional and international organizations and institutions, as the members of the Union (3) sit on the Council won. of Directors of the International Organization of Security Commissions (IOSCO), including the position of Vice-President The Board, Chairman of the Committee for Growth and Emerging Markets, in addition to Chairman of the Regional Committee for Africa and the Middle East The Federation was also able to strengthen its role in building the self-sufficiency of the Federation members by implementing more than (40) specialized training programs in which approximately (1935) participated. ) employees, and a number of workshops, seminars and forums in various fields of interest to the members of the Federation.

Strategic plan (2021-2025)

During the meeting, the council discussed the federation’s annual report for the year 2021, and the key achievements made during the first year of the strategic plan (2021-2025), in particular with regard to the completion of the related work. with the multilateral memorandum of understanding; For the exchange of information between the Member States of the Union, and in the light of the Council’s decision to approve and approve the text of the final memorandum, and to sign the memorandum by the members of the Union completed, the Council decided to proceed with the procedures for the proper implementation of the memorandum from 05/11/2022. The Board also reviewed the report of the auditors and the final audited accounts of the Federation for the fiscal year 2021, and decided to ratify them in accordance with the provisions of Clause Seven of Article (11) of the Statute of the Federation.

The annual report indicates that the General Secretariat, within the framework of strengthening cooperation between the members of the Federation in the field of developing capital markets, and which faces risks in cooperation with the working team formed for this purpose, ‘ prepared a special survey covering various aspects related to the development of Arab capital markets, and it was distributed to the members of the Federation, and the receipt of answers and their analysis; In preparation for completing work in this aspect. It should be noted that the working team is currently collecting the initiatives and legislation applied by the members of the trade union in the field of facing market risks and supporting liquidity; This is in preparation for the development of an indicative guide on the priorities of members; To evaluate and confront the challenges posed by global crises in their various forms.

The working group is also drafting general guidelines related to combating money laundering and terrorist financing, as well as drafting general rules related to the best applicable standards in the field of sustainability.

On the topic of financial technology and cyber risks, the working team completed the analysis of the results of the questionnaire prepared and distributed to the members of the union, as the questionnaire provided important information about the reality of the financial technology sector among the members. of the union. The task force compiles appropriate fintech and cyber security legislation and legal or regulatory frameworks; In order to provide it to the members of the Federation, as well as in the field of artificial intelligence and machine learning, where general rules and controls have been established; To improve the cyber security of the members of the Federation, as well as to prepare proposals on the definition of the regulatory procedures and requirements related to the topic Know Your Customer (KYC); In preparation for preparing a guide for this.

financial aid programs

The Federation’s annual report showed that during 2021, world markets continued to recover from the effects caused by the outbreak of the Corona virus (COVID-19), which led to the decline of financial markets to low levels that did not has not been seen in decades. Despite this, unprecedented financial support programs to gain access to effective vaccines to confront the virus could help financial markets recover from the rise, and achieve record growth rates that exceeded the levels they reached before the virus broke out. .

The year 2021 witnessed a significant growth that was significantly reflected in the indicators of global markets, as data released by the World Federation of Exchanges (WFE) indicates that international financial markets have achieved significant increases in the total market value of global financial markets , $ 124.6 trillion, compared to $ 106.8 trillion in 2020, an increase of 16.7%.

US markets accounted for 46.1% of total global market value, followed by Asian and Pacific markets with 31.6%, and European and Middle Eastern markets with 22.3%.

As for the Arab financial markets, the market value of these markets increased at the end of 2021 compared to the level reached in 2020, reaching about (3.6) billion dollars, an increase of 16.1%, and the market value of the Saudi Stock Exchange (Tadawul) at the end of 2021 accounted for about 73% of the The total market value of the Arab financial markets together, which amounted to 2.5 trillion dollars.

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